Whatever the relative merits or drawbacks there are to forking over giant sums of taxpayer money to failing corporations, it’s hard to see how that is going to reverse the larger trend of deflation.
Consumer prices plunged 1 percent last month, more than forecast and the most since records began in 1947, after being unchanged the prior month, the Labor Department said in Washington. Excluding food and energy, so-called core prices unexpectedly fell for the first time since 1982.
Seriously, after we bail out the automakers, then what? We bail out retailers? Restaurant chains? With job losses mounting this sure looks like a severe deflationary spiral.
We needed a stimulus package yesterday, but that’s not going to happen until at least late January or early February, apparently. Yikes.